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The firestorm in Washington over the deficit and raising the debt ceiling to avert a default is concerning, even nerve-wracking, but the financial community apparently remains more confident than not that an 11th hour deal will be reached and an unprecedented downgrading of U.S. credit avoided.

Conversations with financial analysts and industry insiders suggest a hesitant optimism — certainly not the kind of nonchalance Republican Tea Party types, who seem to think it wouldn’t be that big of a deal, are showing about the prospect of default — coupled with dismay at an “unfathomable” prospect: U.S. businesses having a credit rating lower than that of the country they call home.

“I think you have to assume, I certainly assume, that Tim Geithner, secretary of Treasury, as well as maybe the president himself has spoken with the head of the ratings agencies and said: ‘Make as much noise as you want, but don’t even think about downgrading our debt.’ The implications are huge; if our cost of borrowing increased, it’d dramatically worsen the chances for us to get out of the place we’re in. That’d be a suicide mission for the rating agencies,” said Matthew Andrews, director of research at Private Capitol Advisors, a wealth management firm in New York.

He said the ratings agencies are talking a big game but risk further damaging their already weakened reputations by following newcomer Egan-Jones in dropping the United States’ credit rating to AA from AAA.

“The risk is that they’re making a colossal call; they’ve been attacked for so long for being on the wrong side. They missed the housing crisis, they missed Lehman. If they were premature on making this call, you’ve got so many investors and companies involved in this decision, it’s not just the credit call of some specific company. You’re opening up a can of worms; everybody knows how much debt is outstanding. So to prematurely say you can’t borrow, to be the guys who go out in front, the repercussions are unimaginable.”

We’ve seen market volatility but not a crash like that of the fall of 2008 because the major credit agencies have kept their powder dry thus far.

“Is it possible for a company to have a higher debt rating than the country it’s located in? If the answer is no, you have a spiral effect, a vicious cycle. The companies in this country that have relied on their credit quality to borrow at very low rates would be jeopardized by a rating agency that questioned the state of the largest global economy based on a legal borrowing limit. This isn’t Greece or Italy, this is the United States of America. When you create that kind of uncertainty that’s when the market goes down.”

An investment analyst at a boutique firm who asked to be kept anonymous added that “[e]xcluding the fact that I work in the finance industry, as an American, the implications of a U.S. default whether it’s political or solvency related, are concerning as a consumer, for what it means for my dollars, what it means for my assets held in dollars, and interest rates. The implications are dire.”

“The implications [of a default] are unfathomable. It would be a Black Swan event. Like Lehman Brothers. The repercussions would be felt deep and wide.”

That being said, he indicated that many, including himself, were glad the country was having a serious discussion about the structural budget deficit.

“This has been a drawn-out, unnerving process, but [at least] we’re having a real conversation that will end with them raising the limit, and we will have gotten everybody on the record talking about the debt, talking about how we’re over-leveraged as a nation.

Negotations over raising the Treasury Department’s borrowing authority remain stuck in neutral in Washington, with Senate Majority Leader Harry Reid (D-NV) and Speaker of the House John Boehner (R-Ohio) pushing forward with very different debt ceiling plans this week. The nonpartisan Congressional Budget Office liked Reid’s more, saying it cut deficits by $2.2 trillion through 2021, almost three times the $850 billion Boehner’s bill would achieve. This is mostly accomplished by capping future war spending, something Republicans say isn’t legitimate but many hope will be part of the deficit conversation when the U.S. continues to outspend the rest of the world combined on its military.

But Standard and Poor’s, one of the louder voices among the rating agencies lately, has called for some $4 trillion in deficit reduction and assurances “that such an agreement would be enacted and maintained throughout the decade,” a lot to ask from the least productive Congress in memory, though the firm backed away from that hardline stance in testimony before Congress late Wednesday afternoon.

And some are arguing that the very threat of a default has effectively downgraded the United States’ credit already.

“Everyone already knows that the U.S. has lost its AAA status….The investment world knows that the U.S. is not AAA,” Jim Rogers, the analyst and investor who regularly appears on television to discuss the market, told the Wall Street Journal.

If a downgrade is worrisome, a default is positively terrifying, even if people in the orbit of finance try to stay optimistic.

“Our top priority is ensuring the debt ceiling is increased,” said Blair Latoff, director of communications at the Chamber of Commerce, the nationwide business lobbying organization that vociferously opposed Barack Obama’s healthcare overhaul.

“From a market perspective, I would argue that the [financial community, even at this late stage] still doesn’t believe the Republicans and Democrats are dumb enough to let a default happen,” Andrews concluded.

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With a deranged narcissist in the Oval Office and his lackey controlling the Department of Justice, there is no point in looking to the federal government to curb police violence. Instead, President Donald J. Trump will do everything in his power to encourage it. In the wake of protests over the murder of George Floyd, he has demanded that governors crack down on protestors: "You have to dominate. ... If you don't dominate, you're wasting your time," he told them.

Moreover, most local police authorities are under local control -- mayors, city councils, district attorneys, police chiefs, sheriffs. That's where the accountability for police misconduct begins.

<p>But Congress could take a significant step toward reining in that misconduct by passing a bill to end the practice of allowing the Pentagon to give surplus war equipment to local police departments. There is simply no good reason for police in any city -- from Washington to Wichita -- to roll down the streets in armored personnel carriers, armed with battering rams and grenade launchers. They are not going to war. American citizens are not enemy combatants.</p><p>Several Democrats have already announced their intention to introduce legislation to end the practice. Sen. Brian Schatz, D-Hawaii, has said he would introduce such a measure as an amendment to the all-important annual defense policy bill -- which would give it a decent shot at passing since Republicans are deeply invested in the defense bill.</p><script async="" src="//pagead2.googlesyndication.com/pagead/js/adsbygoogle.js"></script>
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</script><p>After protests broke out in Ferguson, Missouri, in 2014 following the fatal shooting of Michael Brown by a police officer, local law enforcement authorities took to the streets in armored carriers, further inflaming tensions. They showed little inclination toward restraint or de-escalation. The same thing is occurring in cities around the country right now.</p><p>Off-loading surplus military hardware to local police departments was never a good idea. The practice started back during the 1990s as violent crime peaked and local and federal authorities were feverishly devoted to winning the so-called war on drugs. After the terrorist attacks of 9/11, the program ramped up, doling out battlefield gear even to small towns no self-respecting terrorist ever heard of.</p><p>Law enforcement agents became enamored of images of themselves decked out like soldiers on special-ops missions. According to <em>The New York Times</em>, the website of a South Carolina sheriff's department featured its SWAT team "dressed in black with guns drawn, flanking an armored vehicle that looks like a tank and has a mounted .50-caliber gun."</p><p>Poor neighborhoods are subjected to the military-style hardware much more often than affluent ones. And the consequence of that sort of policing is often less safety, not more. When the police behave like an occupying force, the residents return the favor -- treating them with suspicion and contempt. That hardly makes it more likely that police will get the information they need to solve crimes.</p><p>The administration of President Barack Obama understood that and curbed the Pentagon program after Ferguson. In the final years of the Obama administration, the Pentagon reported that local law enforcement agencies had returned 126 tracked armored vehicles, 138 grenade launchers and 1,623 bayonets, the Times said. Pause for a moment just to consider that. Why would any police department -- even New York City's army of 36,000 officers -- need bayonets and grenade launchers? Once you implant in the heads of police officers the notion that they need battlefield gear, their use of violence against unarmed citizens escalates as a natural consequence.</p><script async="" src="//pagead2.googlesyndication.com/pagead/js/adsbygoogle.js"></script>
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</script><p>But guess what happened when Trump took office? He removed Obama's restraints on the Pentagon program, once again allowing local law enforcement agents to go to battle against the citizens they are sworn to protect. No surprise there. In 2017, Trump gave a speech in which he urged police officers not to worry about injuring a suspect during an arrest.</p><p>Police violence against black people is a problem as old as the nation itself. It didn't start with Trump's presidency and won't end when it's over. Rather, the racist culture that is embedded among so many law enforcement agencies showed itself clearly when major police unions enthusiastically backed Trump's election. When Trump is finally gone, the campaign to eradicate that culture can begin in earnest.</p>